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November 22nd, 2011 - Kelley Chambers

Firm Foundation

After a few lean years, the Oklahoma City Community Foundation reports pooled investments exceed 21% for last fiscal year.


After more valleys than hills over the past few years, the Oklahoma City Community Foundation reports for fiscal year 2011, which ended in June, the investment performance exceeded 21%.

That came as good news after the foundation reported the past three years of investment performance have resulted in the lowest returns in the organization’s history.

The actual return for FY 2011 was 21.57% on its pooled investments, which was the best fiscal-year return in its 18year history. The FY 2010 return on pooled investments was 12.99%. Those returns were welcome news to Nancy Anthony, the foundation’s executive director. She credits the dedication to a proven process of allocation review and to quality, diversified investments.

While working to grow and build the foundation’s endowment, Anthony says having the right managers for investments helps them prosper in good times, and brace them to stay afloat in rough times.

right, Steve Mason, Oklahoma City Comunity Foundation president

“You have to take those down years in stride with the expectation you’re still going to get to your result at the end of the day,” she says. “Our goal is to always do better on the average over time.”

While the investment committee and its equity managers cannot control the markets, they can manage risk.

Foundation President Steve Mason says they can control the types of investments and work to limit risk. The foundation does not put all its eggs in one basket by investing in things that could spell huge gains or huge losses, and likewise, does not put all the money into little- to no-risk things such as certificates of deposit that will not pay out an acceptable return.

“Our strategy is to pick the kinds of investments, like equities and bonds, which provide reasonable risk,” he says.

Those practices help maintain and grow the foundation’s $620 million in assets, and the $30 million it contributes to the community each year through 300 nonprofit organizations it serves.

And when a fund or equity manager is under-performing, it is let go. Mason says there have been a few lean years, but due to wise investing, the foundation has kept its commitments.

“We’re a bank for these nonprofits,” he says.

Even with things looking up at the beginning of the calendar year, Anthony says the first months of the current fiscal year already have proven challenging.

The foundation began in 1969, led by oilman and philanthropist John E. Kirkpatrick and eight other community leaders. The goal was to make Oklahoma City a better place and support charitable causes through donations to build endowments. Thousands of donors have helped make that mission possible over the foundation’s lifetime.

Its investment policy must provide annual distributions for an endowment fund and annual distributions to charitable causes in perpetuity. Those investments must grow to fund general distributions, accommodate inflation and continue on into the future. The policy in place to make that happen includes four major objectives: capital preservation; inflation protection; continuing source of annual distribution for charitable purposes; and maintaining investment return in the top third of professionally managed funds.

In pooled investment results for FY 2011, tracking the previous year – and the last three, five and 10 years – the foundation’s numbers show its equities, fixed income and total return have at times lagged, but most often kept pace or outperformed the S&P 500 and Barclays Capital G/C Int.

right, Nancy Anthony, Oklahoma City Community Foundation executive director

“I commend our investment committee and money managers for keeping our long-term investment perspective in mind, but also seizing opportunities for tactical allocations that add value,” Anthony says. “Both the investment committee and our board of trustees view these responsibilities among the most important that we provide as managers of the community’s endowment.”

Mason says the foundation’s long history of wise management ensures it will be around for many more years, in good and bad economic times.

“It’s a patient investment method,” he says. “We don’t get spooked easily.”

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